Höegh LNG – The floating LNG services provider
4Q 2016Presentation of financial results
28 February 2017
Forward looking statements
2
This presentation contains forward-looking statements which reflects management’s current expectations, estimates and projections aboutits operations. All statements, other than statements of historical facts, that address activities and events that will, should, could or mayoccur in the future are forward-looking statements. Words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,”“forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue” or the negative of these terms and similar expressions areintended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject tocertain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomesand results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place unduereliance on these forward-looking statements, which speak only as of the date of this presentation. Unless legally required, Höegh LNGundertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events orotherwise.
Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changesin LNG transportation and regasification market trends; changes in the supply and demand for LNG; changes in trading patterns; changesin applicable maintenance and regulatory standards; political events affecting production and consumption of LNG and Höegh LNG’sability to operate and control its vessels; change in the financial stability of clients of the Company; Höegh LNG’s ability to win upcomingtenders and securing employment for the FSRUs on order; changes in Höegh LNG’s ability to convert LNG carriers to FSRUs includingthe cost and time of completing such conversions; changes in Höegh LNG’s ability to complete and deliver projects awarded; increases inthe Company’s cost base; changes in the availability of vessels to purchase; failure by yards to comply with delivery schedules; changesto vessels’ useful lives; changes in the ability of Höegh LNG to obtain additional financing, in particular, currently, in connection with theturmoil in financial markets; the success in achieving commercial success for the projects being developed by the Company; changes inapplicable regulations and laws; and unpredictable or unknown factors herein also could have material adverse effects on forward-lookingstatements.
Highlights / markets / summary
Key financials
Appendix
3
Sveinung J.S. StøhlePresident & CEO
An eventful end to 2016 and start to 2017
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Subsequent events
Signed shipbuilding contracts with Hyundai HI for an FSRU with delivery in 4Q 2018
Placement of NOK 1,500 million in the Nordic bondmarket
HoA with Qatar Petroleum, ExxonMobil, Total and Mitsubishi Corp covering terminal infrastructure for theGEI project in Pakistan
Potential delay for the GNL Penco FSRU project
Declared dividend of USDc 12.5 per share for the first quarter of 2017, up 25% from the previous quarter
4Q 2016 highlights
Improving underlying results: EBITDA of USD 31.2 million and net profits of USD 0.8 million
Signed a 20-year FSRU charter agreement withQuantum Power for Ghana
Signed a 20-year FSRU charter agreement with Global Energy Infrastructure (GEI) for Pakistan
Höegh Grace successfully commenced commercialoeprations
Sale of 51% equity interest in Höegh Grace to Höegh LNG Partners and successful public offering of commonunits in Höegh LNG Partners
LOI and subsequently signed shipbuilding contract for one firm and three optional FSRUs at Samsung HI
10 10 10 1012,5
1Q16 2Q16 3Q16 4Q16 1Q17
Dividend (USDc/share)
25 27 27 2631
4Q15 1Q16 2Q16 3Q16 4Q16
EBITDA (USDm)
Solid operational track record
5
FSRUs in operation: 6
LNG carriers in operation: 2
Total regas capacity: 3.4 Bcf/day
Average age, FSRU fleet : ~4.5 years
Close to full technical availability and zero lost time injuries recorded for 2016
FSRUs under construction: 4
Total regas capacity, orderbook: 3.25 Bcf/day
99,9 % 99,7 % 100,0 % 99,9 % >99,5 %
2013 2014 2015 2016 Target
Technical availability
1,07
0,44
0,73
0,00
<1,00
2013 2014 2015 2016 Target
LTIF1
1 Lost Time Injury Frequency
Delivering in accordance with strategy
6
Orderednewbuilding
Orderednewbuilding
Long-term contract
Long-term contract
•20 year contract with GEI in Pakistan with startup 2Q 2018
•Annual EBITDA: USD 36 million
•Signed LOI for one plus three optionalFSRU newbuildings
•Firm agreementsigned 17 January2017
•20 year contract withQuantum Power in Ghana with startup2018
•Annual EBITDA: USD 36 million
•Signed shipbuildingcontract for one FSRU newbuilding
•Delivery 4Q 2018
Refinancedbond
•Issued new 5yr NOK 1,500 million senior unsecured bond
•13% buyback ofHLNG01
Raised equity in HMLP
•Sold 51% of Höegh Grace to HMLP
•HMLP raised USD 112 million
Fina
ncin
gm
ilest
ones
Com
mer
cial
mile
ston
es
Statoil4 % Total
4 %Engie9 %
GNL Penco14 %
Klaipedos Nafta7 %
SPEC17 %
PGN LNG14 %
EGAS3 %
Quantum Power14 %
GEI14 %
Increasing diversification as revenue backlog grows
Revenue backlog of USD 6.2 billion1
14 years average remaining tenor
QP and GEI contracts further diversifybacklog Each contract for 20 years with an average
EBITDA contribution of USD 36 million annually
No contract exceeding 17% of backlog
55% of backlog from counterpartsoperating in investment grade countries(Norway, France, Colombia, Chile, Lithuania)
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Charter backlog1 by charterer
1 Proportionate method
Ghana FSRU to import competitively priced LNG
Key terms: 20 + 5 years, EBITDA USD ~36m annually, startup 2Q 2018
Counterpart: Quantum Power (QP), FSRU #7
Strategic rationale: Replace expensive liquid oil products withLNG and to cover energy deficit in power generation
Structure: HLNG charters FSRU to QP, which builds the mooring system and pipeline to shore. QP has the Tolling Agreement with GNPC where GNPC pays a fixed fee to QP for the FSRU, pipeline and other infrastructure services. GNPC imports LNG and sellsregasified LNG to the end consumers
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Source: Navionics maps, Quantum Power
New pipeline to be providedby Quantum Power
FSRU site
Port of Tema and the offshore FSRU infrastructure
Spread mooring system (QP)
Pipeline to shore (QP)
Pakistan FSRU project on schedule for mid 2018 startup
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Key terms: 20 + 5 + 5 years, EBITDA USD ~36m annually, startup 2Q 2018
Counterpart: Global Energy Infrastructure (GEI), FSRU#9
Rationale: Cover energy deficit in power production and industry by using low cost LNG
HoA between a consortium ofQatar Petroleum, ExxonMobil, Total, Mitsubishi Corp. and Höegh LNG for the constructionof the terminal less FSRU
Structure: GEI has LNG purchase agreements (Qatargas) and will sell the regasified LNG in the domestic market. HLNG charters the FSRU to GEI, the consortium provides the terminal infrastructure to GEI under a Tolling Agreement
FSRU site
Source: Navionics maps
Easy accessfrom sea
Port Qasim and the GEI FSRU project
16 km offshore pipeline route, to be constructed
by the consortium
Independence-like jetty to be constructed by the consortium
Onshore gas grid
LNG from world markets
Onshorefacilities
A larger fleet provides for greater flexibility
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* LNGC** 100% basis. Vessels are partly owned.*** Intermediate trading assumed**** 51% of the vessel has been dropped down to HMLP. Remaining 49% assumed to be dropped down.
Vessel Built EBITDA Charterer
USDm/yr 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2023 2032 2025 2034 2027 2036 2029 2038
Höegh LNG HoldingsArctic Princess* 2006 19** Statoil
Arctic Lady* 2006 19** Total
Independence 2014 47 KN
FSRU#7*** 2017 36 Quantum Power
FSRU#8*** 2018 36 Penco LNG
FSRU#9 2018 36 GEIL
FSRU#10 2019
Option 1, 2 and 3 2019/2020 (indicate delivery slots)
Höegh LNG PartnersNeptune 2009 33** Engie
GDF Suez Cape Ann 2010 33** Engie
PGN FSRU Lampung 2014 40 PGN
Höegh Gallant 2014 38 Egas
Höegh Grace**** 2016 42 SPEC
Long-term contract Extension option Intermediate contract Under construction
* 100% basis
Contract overview
Asset base and contract allocation Current allocation:
FSRU #7: Quantum Power, Ghana
FSRU #8: Penco LNG, Chile
FSRU #9: GEI, Pakistan
FSRU #10: Uncommitted
Penco LNG update: Timelinecould be changed
Strength of flexibility: In thecase of a delayed start-up in Chile, fleet allocation could be changed with FSRU #8 allocatedto another project from thecompany’s backlog of existing or ongoing tenders for new projects
Several projects in tenders/earlyprocess with start-up in thesecond half of 2018 and 2019
Highlights / markets / summary
Key financials
Appendix
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Sveinung J.S. StøhlePresident & CEO
LNG volumes expanding on liquefaction capacity additions
LNG production rose by 17mt, or by ~7%, in 2016 The first year of meaningful growth
since 2011
Liquefaction capacity was 37mt higher y/y at end-2016; utilizationof newly added capacity to increase in 2017
35 countries imported LNG in 2016, up from 18 ten years ago
Several countries started importing LNG in 2016 : Colombia, Jamaica, Pakistan
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Liquefaction capacity and production 2000 - 2022
Source: Clarksons Platou, Shell LNG outlook 2017
Incremental volumes shipped to new markets
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Source: Shell LNG outlook 2017
New market entrants clearly prefer FSRUs for their LNG imports
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~80% FSRUs
~65% FSRUs
Mostly land based
terminals
New markets1
Recentmarket
entrants2,3
EstablishedLNG markets
LNG importing countries: Existing and planned/potential
Already have FSRUsFSRUs planned or under constructionHave FSRUs, but market is dominated by land based terminals
Source: Cheniere 3Q16 presentation, amended by Höegh LNG
LNG volume growth mirrored by increase in FSRU contract awards
2011 2012 2013 2014 2015 2016
BW Gas
Excelerate
Golar LNG
Sum 3 2 2 4 3 6
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Long-term FSRU contract award1
.1 Does not include cancelled projects, contract renewals and sublets
Pipeline of around 40 projects around the globe
ExistingUnder construction / awardedPotential More than 40 projects in pipeline
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More fragmented competition, but limited orderbook
The orderbook stands at 12 FSRUs, of which 4 areuncommitted
Uncommitted FSRUs (4 newbuildings, 1 existingvessel) compare to 14% ofthe total fleet and orderbook of FSRUs
Four existing FSRUs are serving contracts that are about to expire, or at contracts with undetermined timelines
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6
87
1 1
1
3 1
1
3
1
1
2
0
2
4
6
8
10
12
Höegh LNG Excelerate Golar LNG BW Gas Other
Units
FSRU fleet and orderbook1 by owner and employment
On contract Available Committed NB Uncommitted NB
OLT
MOL
Gazprom
Exmar
Maran
Kolin
1 Orderbook defined as firm orders, excluding LOIs, options, conversions
FSRU fleet and orderbook1 by owner and employment
Highlights / markets /summary
Key financialsAppendix
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Steffen FøreidCFO
Financial highlights
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Key figures
1 5021 667 1 644 1644 1 713
40% 36% 36% 36% 40%
4Q15 1Q16 2Q16 3Q16 4Q16
Total assets / Adj. equity ratio (USDm)
USD million 4Q 2016 3Q 2016
Income statementTotal income 62.3 58.1EBITDA 31.2 26.5Net profit after tax 0.8 3.3
Financial positionCash and marketable securities 332 268Total assets 1,713 1,616Adjusted equity 677 576Interest bearng debt 936 955Net interest bearing debt 663
Adjusted equity ratio 39.5 % 35.7 %
25 27 27 2631
4Q15 1Q16 2Q16 3Q16 4Q16
EBITDA (USDm)
Solid liquidity position
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1 The regasification skid ordered in August 2016 assumed to go on FSRU#9. Assuming approximately75% post delivery debt financing. 2 Excluding restricted cash and cash in Höegh LNG Partners. Including settlement of Höegh Grace sale3 Proceeds from HLNG03 bond issue exceeding HLNG01 refinancing need
194-223 200
200
200
175
20
-15
-50
0
50
100
150
200
250
300
350
400
450
2017 2018 2019
FSRU #7 debt FSRU #8 debt FSRU #9 debt FSRU #10 debt Equity
Source USDm
Cash & cash equivalents (2) 167
Marketable securities 135
Outstanding amount seller’s credit 35
Additional liquidity HLNG01 refinancing (3) 50
Cash & cash equivalents 387
Committed financing FSRU#7 223
Total committed funding 610
Assumed financing FSRU#8-10 600
Total funding 1,210
Funding of remaining capex (USD 1.0 billion)1 Liquidity reserve 31 December 2016 (ex HMLP)
Strong trading performance of Höegh LNG Partners (NYSE:HMLP)
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Equity offering to fund Höegh Grace drop down
Issuer Höegh LNG Partners LP (NYSE: HMLP)
Issue Size 6,588,389 common units / net USD112 million
Use of Proceeds
Fund purchase price of 51% of Höegh Graceand partial repayment of seller’s credit
Drop down of Höegh Grace
Asset 51% equity interest in owner of Höegh Grace
Purchase price USD 188.7 million less USD 96.9 million in pro-rate deb outstanding (USD 91.8 million)
Timing Transaction closed 4 January 2017
HMLP unit price development
0
500
1000
1500
2000
2500
10
12
14
16
18
20
22
feb 2016 apr 2016 jun 2016 aug 2016 okt 2016 des 2016
HMLP volume (r.a.) HMLP
S&P500 (rebased) Alerian MLP index (rebased)
LTM performance:
• HMLP: +30%• Alerian MLP index: +31%• S&P 500: +23%
HLNG03 bond issue providing additional investment capacity
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Key terms HLNG03 issue Distribution HLNG03 - Geographical split - Allocated
Distribution HLNG03 - Investor type - Allocated
Transaction: Senior Unsecured Bonds
Issuer: Höegh LNG Holdings Ltd.
Principal Amount NOK 1,500 million
Coupon: 3m Nibor + 500bps
Maturity Date: 1 February 2022 (5 year tenor)
Use of proceeds: Refinancing, GCP, potential growth
Documentation : Norwegian
Listing: OSE
Joint Lead Managers: Danske Bank Markets, DNB Markets, Nordea
58%
12%
SwitzerlandUK
Finland
Sweden
Norway Denmark
US
Luxembourg
Other
Retail
Family offices
Asset Managers Banks
Pension and Insurance
Fundations
47%
11%
20%
16%
5%1%1%
3%
11%58%
12%
3%
1%
9%4%
Bond Maturity Coupon Currency Indicativespread
HLNG01 03.10.2017 N3M+600 NOK 190
HLNG02 05.06.2020 L3M+500 USD 440
HLNG03 01.02.2022 N3M+500 NOK 475
Trading performance existing HLNG bonds
Pricing source: Swedbank
Highlights / markets / summaryKey financials
Appendix
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Sveinung J.S. StøhlePresident & CEO
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USD 1.8 billion added to revenue backlog
Solid operational and financial platform enables further backlog expansion
Summary
Dividend increased by 25%
Improved underlying results
Incremental LNG supplies open up new markets and increase FSRU demand
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Q&A sessionCall-in details:Norway +47 21 00 26 13United Kingdom +44 (0)330 336 9104United States +1 719 325 2238
Participant passcode: 279751
Highlights / markets /summary
Key financials
Appendix
26
Income Statement – Joint Ventures according to equity method
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USD million 4Q2016 3Q2016 2Q2016 1Q2016 4Q2015
Freight revenues 56.9 53.6 52.3 51.1 51.3 Management and other income 1.7 1.0 1.5 1.0 3.9 Share of results from investments in joint ventures 3.7 3.5 3.3 3.3 3.5 TOTAL INCOME 62.3 58.1 57.1 55.4 58.7 Charterhire expenses (8.9) (8.9) (8.8) (8.8) (8.9) Bunker expenses (0.2) (0.2) (0.1) (0.0) (1.8) Operating expenses (10.6) (12.1) (11.7) (9.3) (10.0) Project administrative expenses (4.3) (2.9) (2.9) (3.0) (3.2) Group administrative expenses (5.7) (5.2) (4.8) (4.8) (4.1) Business development expenses (1.4) (2.3) (1.8) (2.9) (6.0) EBITDA 31.2 26.5 27.0 26.6 24.6 Depreciation (9.1) (9.2) (9.2) (7.3) (6.9) Reversal of impairment (impairment) - - - - (37.0) EBIT 22.1 17.3 17.8 19.3 (19.3) Interest income 0.3 0.3 0.4 0.5 0.4 Interest expenses (13.3) (14.3) (14.6) (12.9) (12.6) Other financial items (5.6) 1.1 0.4 0.2 (0.4) PROFIT (LOSS) BEFORE TAX 3.5 4.4 4.0 7.1 (32.0) Taxes (2.7) (1.1) (0.5) (0.8) (1.0) NET PROFIT (LOSS) 0.8 3.3 3.5 6.3 (33.0)
Financial position- Joint Ventures according to equity method
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USD million 31.12.2016 30.09.2016 30.06.2016 31.03.2016 31.12.2015
Licences, design and other intangibles 0 0 0 0 0Newbuildings under construction and vessels 1 269 1 245 1 247 1 225 1 033Shareholder loans to joint ventures 7 9 10 13 14Mark-to-market on hedging instruments 8 0 0 0 3Other assets 78 71 73 66 71Restricted cash (non-current) 19 23 20 20 20Current cash and marketable securities 332 268 294 343 344Asset held for sale 0 0 0 0 18TOTAL ASSETS 1 713 1 616 1 644 1 667 1 503 Total equity 596 442 434 456 492 Investments in joint ventures 49 76 85 83 74 Interest bearing debt 936 955 966 979 787 Mark-to-market on hedging instruments 57 72 86 76 68 Other liabilities 75 71 73 73 83 TOTAL EQUITY AND LIABILITIES 1 713 1 616 1 644 1 667 1 503
Total equity adjusted for hedging reserves 677 576 585 592 598 Equity ratio adjusted for hedging reserves 40 % 36 % 36 % 36 % 40 %Net interest bearing debt 585 663 650 616 423
Cash flow statement- Joint Ventures according to equity method
29
USD million 4Q2016 3Q2016 2Q2016 1Q2016 4Q2015
Net profit or (loss) before tax 4 4 4 7 (32) Adjustments of non-cash P&L items 19 19 3 41 Dividend received from joint ventures 21 - - - Net changes in working capital, interest, other (3) (4) (4) 5 4 Net cash flow from operating activities 22 19 19 15 14 Net (investments) proceeds in marketable securities 55 25 10 11 (87) Investments newbuildings under construction and vessels (33) (4) (30) (199) (2) Proceeds from sale of vessel - - - 18 - Proceeds of repayment on shareholders loans 2 2 2 2 1.34Net cash flow from/(used in) investing activities 24 23 (18) (168) (88) Net proceeds form equity issuance 112 - - - - Proceeds from borrowings - - - 200 - Repayment of borrowings (15) (15) (15) (12) (12) Dividend paid to non-controllling interest (MLP) (5) (4) (4) (4) (4) Dividend paid to shareholders of the parent (8) (8) (8) (8) (8) Interest paid (14) (14) (14) (12) (13) Increase in restricted cash (1) - (2) 4 (2) Other financing activities 1 - - (2) - Net cash flow from/(used in) financing activities 70 (41) (43) 166 (38)
TOTAL CASH FLOW 116 1 (42) 13 (113)